Bank foreclosures are houses, commercial properties or land, owned and sold by banks. When bank foreclosure properties are not sold through auction they are given back to the bank. If the property has creditor or tax liens, the bank possesses the ability to have them removed and provide a clean title for the property. In some instances, banks will invest in minor repairs or landscaping improvements to quickly sell the property.
Investing in bank foreclosures offers the potential for considerable return on investment. There are two primary ways to turn a profit with bank foreclosures -- long-term and short-term investing. Long-term refers to rental properties or investing in a primary residence, while short-term refers to strategies such as house-flipping.
Rental properties can pertain to single-dwelling homes, duplexes, townhouses, warehouses, retail outlets or land. House-flipping can involve purchasing a fixer-upper, making repairs and renovations, than selling the house within a short period of time. Or, it can involve purchasing bank foreclosures from private investors and re-selling them to someone else.
In some cases, real estate investors purchase bank foreclosures in bulk from banks. These savvy investors are able to pick up distressed properties for pennies on the dollar. Since they possess a large inventory of homes it is not uncommon to buy bank foreclosures for seventy to eighty cents on the dollar. That interprets into instant equity of 20- to 30-percent.
Buying bank foreclosures from private investors is a smart investment strategy. Both private individuals and investors can purchase bank foreclosures from private real estate investors. If you are looking for a personal residence, bank foreclosure homes can save you a considerable amount of money. Additionally, buying a home under market value can help you obtain traditional financing through a reputable lender.
Investors who want to fatten their financial portfolios would be wise to purchase bank foreclosures with cash. Bypass bank financing and you can buy and sell bank foreclosures at a much faster rater than the average guy. While others are awaiting approval, you can make repairs and renovations and place your house on the market.
Investing in bank foreclosures is not without risk. Engage in due diligence and thoroughly inspect the property before you buy. If you are unfamiliar with purchasing bank foreclosures through a private real estate investor, consider using the services of Simon Volkov. He offers a wide range of investment opportunities available for free through his Real Estate Investment Club.